Moody's Investors Service Inc. said revenue for Hong Kong-listed Cambodian casino operator Nagarp Ltd is expected to rise 16.5% year-over-year in 2024.
The rating agency expects these GGRs to be $621 million compared to $533 million in 2023.
Moody's, however, added in a note on Tuesday that the casino company's profit before interest, taxation, depreciation and amortization (EBITDA) margin is expected to decline by 2 percentage points to 35%. Moody's Financial Metrics and its own estimates are cited.
The agency expects EBITDA to expand 8.5% year-over-year in 2024 from $295 million last year to about $320 million.
Moody's expects Nagakov's debt-to-EBITDA ratio to fall to 0.4-fold from 1.8-fold in 2023.
Nagakov has exclusive rights to Jangsu Casino in Phnom Penh, the capital of Cambodia, which operates the Nagaworld complex (pictured).
Moody's said Nagakov's "B3" corporate family rating "includes refinancing risks because it holds significant U.S. dollar bonds due in July 2024 ″."
The rating agency added: "Nagakov took steps to preserve liquidity by taking out shareholder loans and reducing discretionary spending. However, a slowdown in earnings recovery could weigh on liquidity."
Nagakov said earlier this month that it planned to pay off some of the 7.95% senior bonds issued by the company when it expires on July 6, 2024 ″ by cutting loans of up to US$80 million extended by the company's controlling shareholder.
Moody's said in its latest credit opinion of Casino Group that its B3 rating reflected Nagarwold's "dominant" market position, driven by Cambodia's "low labor and gaming tax rates," which also supported a "beneficial cost structure."
The agency observed: "The ratings are limited by Nagakov's single-site operations, exposure to political risks, and Cambodia's evolving regulatory framework."
Casino Group said in a voluntary filing in early April that its first-quarter gross gaming revenue (GGR) rose 23.7% year-over-year to close to $145.4 million.
Moody's observed that EBITDA was $80.3 million in the three months to March 31, up 32.6% year-over-year, but "not significantly changed from last quarter."
However, Nagarkov management had mentioned in February that it planned to scale back the size and budget of Nagarwold's Nagarwold extension project to minimize capital expenditure. "If possible, there could be surplus cash flow for dividend payments."
"Nagakov has taken steps to preserve liquidity, such as paying a scribe dividend instead of cash and reducing development spending related to its expansion project, Naga3," Moody's said in its latest evaluation
The rating agency added: "We expect the company to spend just $15 million on Naga 3 for the first six months of 2024.
BY: 안전한 카지노사이트